Often few bars and restaurants come under such a poor financial situation that many of them find that they are having more debts as compared to what they can manage.
In few cases, bars and restaurants are able to reorganize all their debts through the provision under Chapter 11 bankruptcy, that also allows them to keep all their doors open to their customers.
Under certain other situation, owners of these bars and restaurants come to realize that their profit will not be sufficient even by keeping their doors open. Those business owners, prefer to consider Chapter 7 bankruptcy.
As restaurant or bar owner files for bankruptcy under Chapter 7, assets from those business typically will be liquidated for paying remaining creditors. However, there is one asset which many bars and restaurants have is liquor license.
In this small write up, we will discuss about few things that owners of bar and restaurant in Florida must know about their liquor license in Miami in case of Chapter 7 bankruptcy.
Can the liquor license be sold or transferred?
While dealing with the liquor licenses in case of Chapter 7 bankruptcy, the first question must be asked by bankruptcy trustee or debtor-in-possession is whether liquor license is termed as “property of estate” as per U.S. Bankruptcy Code.
In fact, liquor licenses are not same as other assets that any business can possess as they should be approved by the state government. Generally speaking, party having possession of liquor license may get it revoked under few circumstances.
However, as courts will address the issue, then liquor licenses will be treated as “property of estate” which is defined under Bankruptcy Code.
Second question will be whether liquor license has certain monetary value during bankruptcy stage. For owners of bar and restaurant in Florida, such liquor licenses have sufficient monetary value.
These quota licenses are very coveted as they can be always used anywhere in county as such, all liquor licenses in the Florida tend to have very good monetary value.
If any bar or restaurant wants to sell wine and beer, then it may obtain license from Florida Division of Alcoholic Beverages and Tobacco. However, if it prefers to sell spirits and cocktails, then they should obtain these “coveted” licenses.
Transferring liquor license in the Florida
U.S. bankruptcy laws play an important role to determine whether liquor licenses are considered property of estate in any bankruptcy case and Florida state law governs all the transfers of liquor licenses.
While liquor licenses get sold or transferred on proceeding of Chapter 7 bankruptcy in the state, the Florida law will specify that transfer fees are waived, but license renewal fee may still apply.
Learn more from bankruptcy lawyer
For restaurants, bankruptcy can be bit complicated, especially if there are questions regarding liquor license sale or transfer. An experienced bankruptcy attorney may answer all your questions about bankruptcy.
You may contact any Law Advocates, who are experienced in this field to learn about how they can assist owners of bar and restaurant for their bankruptcy cases.